August 10, 2012 / 6:49 AM / 5 years ago

Nikkei ends 4-day rally but logs best weekly gain since February

* Nikkei gains 3.9 percent on the week
    * DeNA soars on strong results, pulls up Gree
    * Sony firms on So-net purchase
    * Sharp scrambles back up 9 pct on short squeeze

    By Sophie Knight
    TOKYO, Aug 10 (Reuters) - Japan's Nikkei share average fell
on Friday as investors lacked fresh incentives to buy, but the
index still marked its biggest weekly gain since February
following a four-day rally spurred by hopes for more global
stimulus.
    The Nikkei lost 1 percent to 8,891.44 points but
advanced nearly 4 percent up on the week, its biggest gain since
mid-February, after surfing a wave of short-covering triggered
by better-than-expected U.S. jobs figures last week.
    Online gaming company DeNA Co Ltd soared 22.1
percent, its biggest-ever one-day jump, on strong results, while
Sharp Corp scrambled up 9.4 percent on a short-squeeze
after dropping as much as 34 percent early this week after
revising down its full-year guidance.
    "This week's rally was entirely fueled by speculation of
stimulus, so concern about a global slowdown retreated," said
Yoshihiro Ito, chief strategist at Okasan Online Securities.
    "But now people are beginning to question what's coming up,
and with the holidays and a poor earnings season the Nikkei
lacks the power to pierce 9,000."
    However, analysts said that the risk aversion that reigned
through July was ebbing as disappointing data from China and the
Bank of Japan's refusal to budge on policy on Thursday only
spurred hopes for further easing in the imminent future.
    "Nothing is actually improving but the bad state of the U.S.
and Chinese economies is priced in now," said Ryota Sakagami,
chief strategist of equity research at SMBC Nikko.
    "If data shows things aren't as bad as assumed then it's a
plus, and yet if they're worse than assumed people expect easing
or stimulus, which is also a plus."
    Amid a weaker market on Friday, a handful of companies saw
gains on the back of strong results as Japan's earning season
drew to a close, including Taiyo Yuden Co Ltd, which
climbed 10.3 percent af t er its earnings beat expectations. 
    DeNA Co Ltd jumped after its solid quarterly
results calmed fears that revenue had been hit by the withdrawal
of its lucrative "complete gacha" game due to pressure from
regulators. The news helped competitor Gree Inc gain
8.1 percent.
    Japan's quarterly earnings season has been relatively weak,
with 53 percent of the 142 Nikkei companies having undershot
market expectations, compared with 40 percent in the previous
quarterly earnings season, data from Thomson Reuters StarMine
showed.   
    Yamada Denki Co Ltd bounded up 7.9 percent despite
posting a 73.8 percent year-on-year decrease in operating profit
for the April-June quarter, as brokerages said sales had been
distorted due to the switch to digital from analogue
televisions. 
    "With the earnings season now over, investors will be
looking to the economic indicators out next week as a measure of
business confidence," said Masayuki Doshida, senior market
analyst at Rakuten Securities.
    The Bank of Japan cut its assessment on exports and output
on Thursday as Japanese firms feel the pressure from slowing
global growth, but followed the U.S. Federal Reserve and the
European Central Bank in deciding to hold fire on policy
changes. 
    The broader Topix dropped 0.7 percent to 746.79. 
    
    SONY TO PICK UP SO-NET
    Sony Corp ended up 2.7 percent after climbing as
much as 5.6 percent after it said on Thursday it plans to buy
all the shares it does not already own in So-net Entertainment
, an internet provider and medical information website
operator, for about 60 billion yen ($765.70 million). 
    So-net shot up 21.1 percent to 402,000 yen, while the news
also awarded a 6.5 percent gain for M3 Inc, a marketing
company and a listed subsidiary of So-net.
    Against the strength of competitors DeNa and Gree, Japanese
online game provider Nexon Co Ltd sank 24.5 percent
after the company cut its full-year operating profit guidance by
9.9 percent to 47.1 billion yen.

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